An NVWA criminal investigation can have major consequences for businesses. The Netherlands Food and Consumer Product Safety Authority (NVWA) is known to many businesses as a regulator that carries out inspections, issues warnings and sometimes imposes an administrative fine. That image is not incorrect, but it is incomplete. The NVWA also has its own special investigation service, the Intelligence and Investigation Service, abbreviated NVWA-IOD. As a result, an inspection that starts as a routine check can develop into a criminal investigation and ultimately even lead to prosecution by the Public Prosecution Service.
For companies in the food, animal feed, agricultural and animal health sectors, the distinction between administrative enforcement and criminal investigation is of great importance. Not only do the powers and procedures differ, the consequences and the required strategy also vary considerably.
Two enforcement tracks
The NVWA supervises compliance with, among other things, the Commodities Act, the Animals Act, the Agriculture Act, the Fisheries Act and the Fertilisers Act. In the event of a suspected violation, it can take various measures. Whether this leads to an NVWA criminal investigation depends on the nature and severity of the violation.
Administrative law track
Within the administrative law track, the NVWA can, for example, issue a warning, impose an administrative fine, impose an order subject to a penalty payment, apply administrative enforcement, suspend or withdraw a licence, or restrict or terminate a recognition or registration. An administrative fine is usually imposed after an inspection and a fine report. Objection and appeal are available against such a fine.
Criminal law track
In the case of more serious or more complex violations, the case can be investigated under criminal law. This can lead to an official report, a criminal investigation by the NVWA-IOD, a punishment order, a settlement proposal, or a summons and hearing before the criminal court.
The choice for a particular track is not determined solely by the regulator carrying out the inspection. The NVWA works with an intervention and sanction policy. The seriousness of the violation, the risks to public health, food safety or animal welfare, and the circumstances of the case all play an important role.
Intent, fraud, systematic conduct and repeat offending can also be grounds for criminal enforcement. An isolated administrative error is more likely to be dealt with under administrative law. Structural fraud involving labelling, illegal slaughter, serious animal welfare violations or trade in prohibited substances, on the other hand, can lead to criminal investigation.
The Economic Offences Act
Many violations of the regulations supervised by the NVWA are designated as economic offences. The Economic Offences Act therefore forms an important link between the substantive rule and criminal law enforcement.
Depending on the relevant standard and whether the conduct was intentional, a violation can be classified as a crime or as a minor offence. This distinction can affect the available investigative powers, the possible sentence, the possibility of pre-trial detention, the qualification of the conduct, and the position of individuals within the company. In cases of deliberate fraud, such as intentionally manipulating labels or circumventing inspection requirements, the culpability can be considerably more serious than in the case of an administrative mistake.
In addition to fines, other penalties and measures may also apply, such as a suspended or unconditional prison sentence, closure of the business, confiscation of goods, disqualification from practising a profession, and publication of the judgment. For companies, the combination of a financial sanction, closure and reputational damage in particular can be far-reaching.
The NVWA-IOD: investigation within the NVWA
The NVWA-IOD is the special investigation service that conducts criminal investigations within the NVWA’s field of work. Depending on the legal basis and the circumstances of the investigation, its investigating officers can, among other things, question suspects and witnesses, examine records, secure digital data, seize goods and data carriers, search premises, and arrest suspects. In large-scale or cross-border investigations, the NVWA-IOD can cooperate with, among others, the police, the FIOD, Customs and the Public Prosecution Service, particularly in cross-border criminal investigations.
The Public Prosecution Service is usually involved in these types of cases through the Functional Prosecutor’s Office. That office handles, among other things, complex environmental, fraud and food law cases. The Public Prosecution Service then decides how the case is dealt with, with options including dismissal, a punishment order, a settlement, or a summons.
Administrative fine and criminal prosecution: the una via rule
For the same act, an administrative fine may not simply be imposed as well as criminal prosecution being pursued. This is referred to as the una via rule.
Applying this rule is not always straightforward. In practice, it must be carefully established exactly what conduct is being alleged, which period and facts are at issue, whether it concerns the same act, which enforcement decision has already been taken, and whether an administrative fine has actually been imposed or merely announced. A warning, inspection report or intention to fine does not automatically have the same legal consequences as the actual imposition of an administrative fine. It is therefore important to carefully assess all correspondence and case documents before taking a position.
From inspection to an NVWA criminal investigation
A criminal investigation differs fundamentally from a regular administrative inspection. In an administrative inspection, the emphasis is usually on establishing a violation and gathering information for an administrative measure. In a criminal investigation, more far-reaching powers can be used, such as an unannounced search, securing digital information, and questioning those involved as suspects.
Signs that this is no longer an ordinary inspection include, for example, the presence of NVWA-IOD investigating officers, being cautioned, being questioned as a suspect, the seizure of records, phones or computers, a search, the involvement of the Public Prosecution Service, or questions that concern not only the current situation but also earlier transactions or internal decision-making.
The characterisation of a conversation is important in this regard. A business owner may think he is cooperating with an inspection, while the authorities are in fact already gathering information with a view to criminal prosecution.
The rights of suspects
A suspect has the right to know what he is suspected of. There is also the right to remain silent and to consult a lawyer before questioning. During questioning, there is in principle also a right to legal assistance.
This does not mean that a company can refuse all cooperation. Regulators have their own powers under administrative law and can, under certain circumstances, require cooperation. However, this obligation to cooperate has its limits. A suspect does not have to actively cooperate in his own criminal conviction.
For this reason, it is important from the very first moment to distinguish between information that must be provided on the basis of a supervisory power, statements that can be used as evidence against an individual, company data, and personal statements by directors, employees or de facto managers. An ill-considered statement during an initial conversation can later play an important role in the criminal file.
Directors and de facto managers are also at risk
A criminal investigation does not focus solely on the company as a legal entity. Directors, managers and other individuals within the organisation can also be personally prosecuted. This can be the case, for example, when someone has ordered the violation, knowingly allowed the violation to occur, effectively directed the prohibited conduct, was aware of the violation and failed to intervene, or has benefited from the violation.
Whether personal criminal liability exists depends on the person’s specific role, knowledge and involvement. The mere fact that someone is a director is not sufficient in itself. At the same time, formal distance from day-to-day operations does not always offer protection when someone actually had influence over the running of the business.
Examples of criminal law enforcement
In various cases it has become apparent that the NVWA and the Public Prosecution Service take criminal action in relation to, among other things, fraud involving labelling and origin, illegal slaughter, prohibited substances in livestock farming, manure fraud, trade in prohibited or counterfeit veterinary medicines, serious animal welfare violations, and violations during animal transport.
These examples show that criminal enforcement is not limited to exceptional situations. Especially where there is intent, financial gain, repetition, organised cooperation, or risks to public health and animal welfare, the likelihood of criminal investigation increases.
What to do during an NVWA inspection or raid
Good preparation begins with establishing the nature of the investigation.
During a regular inspection
During a regular inspection, it is advisable to identify the regulator, ask about the purpose and scope of the inspection, make relevant documents available, answer factually and carefully, avoid speculative statements, and keep an internal record of the inspection.
In the event of indications of a criminal investigation
In the event of a raid or criminal investigation, it is also important to immediately engage a specialised lawyer, record which persons and services are present, check the scope of the search or order, avoid destroying or altering any documents or digital data, instruct employees not to make substantive statements without prior consultation, make use of the right to remain silent when someone is questioned as a suspect, ensure that seized goods and data are registered as accurately as possible, and assess the administrative and criminal proceedings in conjunction with each other.
Cooperating with an investigation does not mean that substantive statements must be made without legal guidance. The first hours of an investigation in particular can be decisive for its further course.
In conclusion
Recognising an NVWA criminal investigation at an early stage matters. The NVWA is not only an administrative regulator. Through the NVWA-IOD, it has a specialised criminal law apparatus that can investigate serious and complex violations. The Public Prosecution Service can subsequently decide on a punishment order, a settlement, or prosecution before the criminal court.
For companies in the food, animal feed, agricultural and animal health sectors, it is therefore important to recognise in good time when an inspection is taking on a criminal character. Anyone who seeks legal advice quickly at that stage can better distinguish between the various obligations, rights and risks.
Law & More assists companies, directors and de facto managers with NVWA inspections, administrative enforcement and criminal investigations. This starts with the initial inspection and can, if necessary, continue through to the handling of the case before the criminal court.
